By Yasin Ebrahim

Investing.com – The S&P 500 fell sharply Thursday after a Federal Reserve official stoked fears of aggressive rate hike, sending Treasury yields soaring just as data showed inflation climbed to multi-decade highs.

It fell 1.8%.

St. Louis Fed President James Bullard threw his weight behind the idea of the Fed hiking rates 1% by July,  after consumer price inflation that jumped by a more than expected 7.5% for the 12 months through January, the fastest pace since 1982.

“I’d like to see 100 basis points in the bag by July 1,” Bullard said in an interview with Bloomberg. “I was already more hawkish but I have pulled up dramatically what I think the committee should do.” 

Bullard also suggested that he would be in favor of the Fed hiking rates in-between meetings, which caught the market by surprise as it “signals that maybe the Fed is becoming more worried about inflation,” Melissa Brown, managing director of applied research at Qontigo, an index and analytics provider, said in an interview with Investing.com on Thursday.

“The quarter point increase was certainly priced into markets, with Fed futures market implying about a 90% probability recently, but I’m not sure that a half point or more frequent quarter points were priced in,” Brown added.

According to Investing.com’s, bets that the Fed would raise rates by 50bps next month jumped to 89.9%, up from 24% a few days earlier.

For the first time in over two years, the indices soared 5% to 2%, triggering a wave of fear across stock markets, tech absorbing the majority of the risk.

Apple (NASDAQ;), Alphabet, Meta Platforms (NASDAQ;), Microsoft (NASDAQ :), and Amazon were all a little less than 1%.

The markets did have some good things, though, with the impressive parade of quarterly earnings showing by corporations.

Coca-Cola (NYSE) saw a 0.5% increase after its fourth-quarter results exceeded Wall Street expectations. However, gains were limited by a less-than-expected outlook in the current year due to inflation pressures and a weaker-than-expected outlook.

PepsiCo, (NASDAQ): also beat the bottom and top lines. But it also expressed concern about the rising cost of inputs for next year. Close to 2% of its shares declined.

Walt Disney  (NYSE:), meanwhile, was up more than 3% after reporting better-than-expected quarterly results, underpinned by strong growth in its parks business and upbeat subscriber numbers.

“Management continues to expect that net adds in FY22 will be higher in the second-half vs. the first-half of the year, which potentially suggests upside to consensus estimates, and we see the strong programming slate as justifying another price increase over the coming quarters,” RBC said in a note.

Uber Technologies (NYSE 🙂 fell 6% in spite of better-than expected quarterly results. Ride-hailing companies are promoting the possibility of making free cash flow before the end.

In other news, Affirm  (NASDAQ:) stock slipped 21% on Thursday after the company tweeted out its second-quarter results ahead of schedule.